Silverstein v. Marine Midland Trust Co.

In an action for conversion of shares of stock, the appeal is from a judgment entered on the verdict of a jury in favor of respondents, awarding both actual and punitive damages. Judgment reversed and new trial granted, with costs to appellant to abide the event, unless, within twenty days after the entry of the order hereon, all respondents stipulate to reduce the verdict for actual damages to six cents, and respondents David Silverstein, Leon Silverstein, and Bernard Erbsenthal stipulate to reduce the 1038 verdict for punitive damages to $1,000 for each, in which event, the judgment, as so reduced, is unanimously affirmed, without costs. On and after September 28, 1954, appellant wrongfully withheld possession of shares of stock owned by respondents in a corporation of which they were sole stockholders, officers, and directors. Respondents then had the option of abandoning title to the stock and suing for its value. (Pierpoint v. Hoyt, 260 N. Y. 26.) However, after such wrongful detention, and both before and after the institution of this action for conversion, respondents exercised rights of ownership over the stock by transferring the assets of the corporation to a partnership formed by them, by executing as stockholders, and thereafter filing, a certificate of dissolution of the corporation, and by receiving the return of a substantial portion of their capital investment in the corporation. By resuming dominion over the stock, respondents lost the right to recover the value of the stock. The sole measure of damages under these circumstances is the loss flowing from the wrongful withholding of possession. In this ease that damage was only nominal. In our opinion, the award for punitive damages was excessive. Nolan, P. J., Beldoek, Ughetta, Hallinan and Kleinfeld, JJ., concur.